A series of Au-doped TiO₂ nanoparticles with different Au concentrations were prepared by the sol–gel method using titanium (IV) isopropoxide and tetrachloroaurate (III) trihydrate as precursors. The framework substitution of Au in TiO₂ nanoparticles was established by x-ray diffraction (XRD) and Fourier transform infrared (FT-IR) techniques. X-ray diffraction (XRD) and transmission electron microscopy (TEM) image results confirmed the anatase phase and nanocrystalline nature of TiO₂–Au. The optical properties revealed an extended tailing of the absorption edge toward the visible region upon Au doping. The incorporation of Au in TiO₂ was also confirmed by fluorescence quenching. The increase in Au doping enhanced the ‘red-shift’ in the UV-Vis absorption spectra. The spectral and nonlinear optical properties were studied using fluence-dependent transmittance measurements in order to reveal the optical limiting mechanism. The nonlinear optical response and optical limiting effects of TiO₂–Au nanocomposites dispersed in ethylene glycol were studied at 532 nm using 5 ns Nd:YAG laser pulses. Effective three-photon absorption mechanisms play a major role for good optical limiting characteristics in these nanoparticles and it is seen that the optical nonlinearity enhances with lower threshold as the volume fraction of the Au concentration increased.